Personal Capital brings wealth management service to the iPad

Personal Capital, a Silicon Valley start-up, launched in September with the goal of modernizing personal wealth management and bringing it more quickly into the digital age. Led by former Intuit and PayPal CEO Bill Harris, the company has set its sights on giving people control over their money and investments. Now the company is expanding its online service to the iPad with a free tablet application that makes it easier for users to see and touch their money.

The iPad app replicates the online service’s features, giving people the ability to view all their transactions, debts and investments in one place. From the iPad app people get near real-time tracking of purchases, can follow their mortgages and credit cards and get historical analysis of their cash flow. And more importantly, Personal Capital gives people a view into the underlying makeup of their mutual funds, letting them know how they’re allocating their assets. There’s also the ability to see stock options based on their vested value.

These are all included in the free service and that alone is important, Harris told me. He said consumers have very little idea about what their asset allocation is and how they’re planning for the long term. He said the app is meant to make that process simple and enjoyable, allowing people to swipe and touch their way through their finances.

“For most people, their finances are out of control. They don’t know what it is doing and there’s no plan for the future,” Harris said. “What we focus on is pulling it all into one place.”

Personal Capital’s business, however, is built on upselling a certain amount of users on its paid financial advisor service. For a management fee of less than 1 percent, Personal Capital connects users to a registered investment advisor, who can help manage a customer’s money and provide personalized wealth management advice online. The iPad app extends the service by providing video chats using Facetime and messaging via iMessage or email.

Harris believes that by going digital, Personal Capital can not only offer lower fees than bigger players like Fidelity or Schwab, but also provide better service. He said finance is one sector like media that can handle all of its interactions online. He said while media is being transformed, that evolution hasn’t happened yet in finance.

The company has signed up 10,000 users since its launch and has $2 billion in assets aggregated on the platform. He expects many more will sign up with and use the iPad app.

Personal Capital, which has raised $27 million to date, still faces a challenge in building up a financial advisor company from the ground up without a legacy reputation. Though older competitors may not be as forward thinking in some ways, they have earned a level of trust that Personal Capital will also need to obtain. But I think the company has an interesting take on wealth management and has come up with a good way to give people a better sense about where their money is going. Now, the trick is get users to trust them with their longer-term investing plans. That might take a little longer, but just as connectivity and the Internet have transformed other industries, it should have an effect here too.